news National broadband provider Primus has confirmed it will leave its trial prices for the National Broadband Network fibre unchanged as the fledgling network moves into its commercial phase, declaring itself “comfortable” with its existing model, despite monthly prices that at times range up to $40 more than rival iiNet’s prices per month.
The company will offer three tranches of NBN pricing, based around three speed tiers – 25Mbps, 50Mbps and 100Mbps – and with download limits ranging from 15GB to 300GB (although in each plan, a substantial amount of that quota will be allocated into the company’s off-peak period in the middle of the night). Prices will range from a minimum of $39.95 a month for a 25Mbps plan with 15GB of total data quota included, up to $139.95 for a 100Mbps plan with 300GB of data included – although the majority of that, 220GB, will have to be consumed during that plan’s off-peak period from 12 midnight to 12 midday.
Broadly, the plans do not appear to represent the same amount of value as previous pricing released by iiNet, one of Primus’ major competitors. iiNet, for example, is offering a $99.95 plan, which comes with a total data quota of a terabyte and 100Mbps speeds. The most comparable plan, Primus’ top-level 100Mbps plan with 300GB of data, costs $39.95 more per month.
However, Primus general manager of marketing and products Andrew Sims declared his company was “pretty comfortable” with the company’s pricing at the moment, noting that the ISP wasn’t targeting “the higher users” in the market, and that there was still a bit of work to do to examine how contention ratios in the network would change as more users started to adopt the NBN. “We’ll look into it over the next several months and see what the customer sentiment is,” Sims said. “It’s hard to gauge what the market’s looking for.”
Sims said that the shift to the predominantly fibre-based NBN meant every ISP would have to go back to the drawing board and look at the pricing. Primus had done extensive modelling internally and had learnt lessons from its earlier participation in the NBN trials in Tasmania and on the mainland than other ISPs.
“We obviously want the NBN service to be a success, so we’re talking to customers now on the trial as to how they found the service, on an ongoing basis,” he said. Sims noted Primus also had customers on other fibre networks, not just the NBN – for example infrastructure run by Telstra and Opticomm – and most customers seemed “pretty happy” with the model at the moment.
As various ISPs – first Internode, then Exetel and iiNet – have released their commercial NBN prices over the past month, debate has continued to swirl over whether NBN Co is charging an appropriate amount to ISPs for its wholesale services. Internode, for example, has criticised what it sees as the company’s untenably high prices, while iiNet has declared the prices similar to those it’s currently paying to provide ADSL broadband services.
Sims said the way NBN costs were constructed was different, but in general NBN Co charged “the middle ground” in terms of what Primus would usually pay for wholesale ADSL services. “We’re pretty comfortable with where prices are at,” he said.
Like other ISPs, Primus will also offer NBN customers bundled services with voice and broadband packaged in – and even a free wireless router. And the company is also offering a stand-alone telephone package over the NBN with a $24.95 monthly line rental fee. The cost of the company’s normal monthly broadband plans will decrease by $10 a month if customers bundle in a telephone plan as well. Like other ISPs, Primus will shape customers’ speeds (to 128Kbps in Primus’ case) once they exceed their monthly quota.
Primus appears to be taking a somewhat iterative approach to its National Broadband Network pricing, with the company leaving its trial prices as they are for the commercial NBN launch but also leaving itself open to change in the future. It’s not a bad approach — as Sims pointed out to me today, so far ISPs have only had their existing customers to experiment with in the initial NBN trials, so commercial NBN pricing is a bit of a wild beast which will change quickly.
However, there is still much to dislike in Primus’ NBN plans. Broadly, they are way more expensive than iiNet’s, and deliver poorer value. Restrictive on-peak/off-peak times, crappy quotas, shaping speeds (128kbps) which are a joke … I think Primus can do better than this, and I expect that over the next few months that they will. Remember when I wrote that Internode must slash its “horrible” NBN pricing? Well, the same applies here. Primus has already acknowledged it’s not going after high-end users. But I would recommend even low-end users avoid the company’s NBN plans at the moment, until they get a bit more serious about them.